Europe wants sustainable palm oil, but won't pay for it

By banning palm oil use, the EU is derailing efforts in Malaysia and Indonesia to make production sustainable

epa07747195 A photograph taken with a drone shows areas of forest that have been cleared for oil palm plantations, in Bawa village, Subulusalam, Aceh, Indonesia, 27 July 2019 (issued 29 July 2019). Indonesia is the world's largest producer of palm oil, made from the pulp of the palm fruit. It is widely used cooking and the commercial food industry. Many palm plantations have contributed to the deforestation of tropical rainforest, causing the death and displacements of many species, among them the critically endangered orangutan and Sumatran elephant.  EPA/HOTLI SIMANJUNTAK

As Cop26 ends in Glasgow, a major onus should be on ensuring that all the fine words are put into actions that translate into genuine climate justice. It is also the special responsibility of wealthy nations not to take steps that may salve their consciences but could end up harming developing countries.

The first imperative can be summed up in two words: pay up. At the 2009 Copenhagen climate summit, rich countries pledged $100 billion per year by 2020 to help poorer states adapt to and mitigate the effects of climate change. This target has not been met, and as far as Madagascar's Minister for the Environment and Sustainable Development, Baomiavotse Vahinala Raharinirina, is concerned, this is why her country – which the UN says is facing the first climate change famine – cannot fund a water pipeline to relieve the drought-hit southern part of the island.

"I was wondering during a negotiation session why it is so difficult for rich countries to pay this money," she said in an interview during Cop26. "It's not aid. It's accountability. People from the deep south of Madagascar are victims of something that they didn't do."

The second imperative is for joined-up thinking. Take the issue of deforestation, and the global deal to end and reverse it by 2030.

Indonesia's Environment Minister Siti Nurbaya Bakar drew attention with her Facebook post, saying: "The massive development of President Jokowi's era must not stop in the name of carbon emissions or in the name of deforestation. Indonesia's natural wealth, including forests, must be managed for its use according to sustainable principles, besides being fair." This is a reasonable point for any developing country to make, but particularly one whose president, Joko Widodo (known as "Jokowi"), wants to build a new capital for his country on the island of Borneo. No matter how "green" the new city will be, its development is bound to lead to some deforestation.

But this is an issue that many in the EU see in black-and-white terms – to the extent that in 2018, it banned the use of palm oil for use in biofuels by 2030 over concerns that cultivating the crop was leading to deforestation. This is a very big issue for the more than 300 million people of Malaysia and Indonesia: between them they produce 85 per cent of the world's palm oil, which is used in a vast array of products from ice cream and sliced bread to toothpaste, lipstick, soap and, indeed, biofuels.

Gokong Puntung, a one-year-old male orangutan, rescued from a chicken cage at a house in Aceh, Sumatra. The owner said he had bought the young ape from peopke who had taken it from a palm oil plantation. Conservationists believe the animal's mother would have been killed, because orangutans would not voluntarily be parted from their offspring. Gokong Puntung is recovering at a quarantine centre outside the town of Medan and it is hoped that he will one day be able to be released back into the protected forest.. It is thought that there are just 200 orangutans left in the Tripa Swamp Forest, from where the young ape was taken, where once there were about 2,000. They have been killed or displaced by the spread of palm oil plantations. In 1990 there were an estimated 60,000 hectares of swamp forest: now just 10,000 are left. *** Local Caption ***  Orangutan-23.jpg

As Muhammed Magassy, an adviser to the UK-based think tank Centre for Sustainable Palm Oil Studies, wrote recently: "While smallholder farmers are responsible for significant percentages of palm oil production, they are overwhelmingly not responsible for catastrophic deforestation. The EU's decision to apply sanctions to palm oil will cause immense hardship to huge numbers of economically precarious people of colour and threatens to drive them back into poverty."

Even if done in the name of protecting rainforests and endangered orangutans, this is presumably not a consequence the EU was intending. And there are many in Malaysia and Indonesia who do not want to see their richly biodiverse jungles destroyed either. As long ago as 2004, the Roundtable on Sustainable Palm Oil (RSPO) was set up. With stakeholders ranging from palm oil companies, manufacturers and banks to environmental NGOs, the aim was "to develop and implement global standards for sustainable palm oil", or Certified Sustainable Palm Oil (CSPO).

Within a few years, a major stumbling block became evident. Even though about 19 per cent of global palm oil is now CSPO, many manufacturers and retailers, including in Europe, are unwilling to pay the greater price for it. Only half of the CSPO-produced last year was sold as such – the rest had to be sold as uncertified. As Carl Bek-Nielsen, co-chair of the RSPO, told Bloomberg last week: "People have been screaming and shouting for sustainable palm oil, but as soon as it is available, they found all sorts of excuses and disappeared out that door."

Teresa Kok, Malaysia's then minister of primary industries, made a similar point in 2018. "We have produced higher quantities of CSPO but sadly the uptake from British and European entities is far less than previously promised. We find that there is a constant deferment of their commitment dates. As a result, producers, including smallholders, are questioning the overall rationality of CSPO."

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For, if Europeans are really worried about South-East Asian forests, they should incentivise palm oil producers to go sustainable

As it is, palm oil is far more sustainable than sunflower or rapeseed oil, because the latter require several times more land to produce the same amount. Those two crops are grown in Europe. Would it be too cynical to suggest that the EU ban on palm oil – meaning their own oils would have to be used instead – is another instance of first-world protectionism being given a greenwash?

For, if Europeans are really worried about South-East Asian forests, they should incentivise palm oil producers to go sustainable by committing to buy or find a market for the certified products. Given the EU's capacity to set global standards – many companies around the world align with them simply so they do not risk being shut out – they wouldn't have to take sole responsibility, just perhaps the lead.

I asked Dr Hezri Adnan, executive director of the Malaysian Institute of Economic Research and author of The Sustainability Shift, about the current impasse. "RSPO outlines transnational private standards, and producers break their back to comply, but EU [and US] public regulations say something else," he told me. "I would say there is a degree of antagonism and hypocrisy there somewhere."

There is a simple way forward. As Mr Bek-Nielsen says: "If you want the world to produce sustainable timber, beef, chickens, cars or palm oil, you have to support that movement and be part of the change."

As they head home from Glasgow, that is a message I hope leaders from the Global North take with them. Climate justice means nothing without it.

Published: November 9th 2021, 2:00 PM
Sholto Byrnes

Sholto Byrnes

Sholto Byrnes is an East Asian affairs columnist for The National